|
American companies are facing yet another hurdle: many of
them have post-employment health plans that are underfunded,
even more so than pension plans. In this telling New York
Times article, the cost of post-retirement health care coverage
is revealed, and it’s $284-billion bill is proving to
be more than many companies can handle.
Companies that offer such health coverage--they make up only
5 percent of U.S. companies--are typically large companies
like Ford Motor, I.B.M. and Merck that have stocks held by
investors. As written in the article, "Funding for these
plans is an abysmally low 13.2 percent ... By comparison,
pension obligations at these companies are 65.6 percent funded."
And what’s worse--the health care liability is still
increasing.
As the population continues to age, the corporations will
have to figure out how to pay for the bill, or it will become
another burden to taxpayers.
New
York Times December 14, 2003
| 